X hits on this document

PDF document

EUROPEAN COMMISSION DG Competition - page 89 / 113

314 views

0 shares

0 downloads

0 comments

89 / 113

barriers in the tied market make it easier for the dominant company to protect itself from potential rivals in the tied market.

Product Differentiation in Tied Market 200. Product differentiation in the tied market may reduce the foreclosure effect as competitors are more likely to be able to survive in the market. Customers with strong preferences for the products of competitors in the tied market may, for instance, prefer to switch to a rival product in the tying market rather than forego their preferred product in the tied market.

Market performance of Domco and its competitors 201. The market performance of the dominant company and its competitors may provide evidence about the foreclosure effect. The market share of the dominant company in the tied market may rise after the company starts or intensifies the tying practice and some or all of its competitors may be marginalised or exit. Also entry attempts can provide evidence about possible foreclosure effects.

Possible Counter-strategies 202. Rivals may have effective counter-strategies at their disposal that would allow them to protect themselves against the strategies of the dominant company. Such counter-strategies could, for instance, consist in buying from a producer in the other market in order to create a bundle that can compete with the combined offering of the dominant company.

Counter-strategies of important customers 203. Also important customers may have effective counter-strategies. This may, in

particular, be the case for customers in the tied market, especially if the tying company is not

also dominant in this market. If such buyers are not themselves tied they may be able to prevent the marginalisation of the rivals to the dominant company or sponsor new entry into the tied market.

8.2.4 POSSIBLE DEFENCES: OBJECTIVE JUSTIFICATIONS AND EFFICIENCIES

Document info
Document views314
Page views314
Page last viewedThu Dec 08 18:17:09 UTC 2016
Pages113
Paragraphs1178
Words41343

Comments